US real estate investment trusts (REITs) and investment-grade US bonds surged in August as risk-off sentiment dominated trading around the world. Equities and commodities, by contrast, suffered as investors sought out safe havens and dumped risk assets.

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After pounding the Bahamas, Hurricane Dorian heads to US: CNN
US moves closer to withdrawing troops from Afghanistan: Fox
US-China trade war taking a toll on global economy: WSJ
Goldman Sachs: inflation outside US is accelerating: Bloomberg
Consumer spending in US surged in August: MW
Trade worries weighed on US consumer sentiment in August: Bloomberg
UK mfg activity fell at the fastest pace in seven years in August: Reuters
China’s manufacturing sector contracted for fourth straight month in August: NBS
Eurozone mfg sector continued to contract in August: IHS Markit

Not today. Labor Day, USA!

● The Optimist’s Telescope: Thinking Ahead in a Reckless Age
By Bina Venkataraman
Review via The New York Times
How might we mitigate losses caused by shortsightedness? Bina Venkataraman, a former climate adviser to the Obama administration, brings a storyteller’s eye to this question in her new book, “The Optimist’s Telescope.” She is also deeply informed about the relevant science.
The telescope in her title comes from the economist A.C. Pigou’s observation in 1920 that shortsightedness is rooted in our “faulty telescopic faculty.” As Venkataraman writes, “The future is an idea we have to conjure in our minds, not something that we perceive with our senses. What we want today, by contrast, we can often feel in our guts as a craving.”
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It’s a rough world for yield-hungry investors these days. As interest rates plunge near and far, in some cases diving into negative terrain, searching for a respectable payout in the financial markets has become a race to the bottom. The standard benchmarks for what’s available are US Treasuries, where current yields are plumbing extraordinary depths. What’s an investor to do? We can start by considering the alternatives, courtesy of Mr. Market’s offerings via a broad, multi-asset class portfolio a la the major asset classes.

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Hurricane Dorian strengthens as it nears US: CNN
China may plan to wait out trade war and focus on its own economy: CNBC
German retail sales fell more than expected in July: Reuters
Mixed July data for Japan on retail sales and industrial output: Reuters
Pending homes sales in US fell in July by the most in over a year: LA Times
US jobless claims continue to anticipate strong labor market: MW
US trade deficit narrowed in July as exports picked up: MW
US Q2 GDP growth revised down slightly to +2.0%: CNBC
US Dollar Index rose to 2-year high on Thursday:

Actually, negative rates have already reached America’s shore, albeit in selected bond markets for specific maturities. Current “real” yields for inflation-indexed Treasuries for the 7- and 10-year maturities have dipped below zero in recent days. It’s not the first time that the TIPS market has trafficked in negative rates, but in the current climate it’s impossible to ignore the burning question: Is this a preview for US yields generally?

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Hurricane Dorian set to hit Florida this weekend: CNN
China says it won’t immediately retaliate against latest US tariffs: Bloomberg
China sends new army troops into Hong Kong: CNBC
Global bond yields flirt with record lows: Reuters
Democratic presidential field continues to narrow: NBC
US carried out cyberattack on Iran to thwart attacks on oil tankers: NY Times
German joblessness rises for fourth month in August: Bloomberg
30-year Treasury yield remains below 2.0% for a second day:

The US-China trade war is taking a toll on investor sentiment, but most of the blowback for world stock markets has been borne outside the US, based on year-to-date results for a set of exchange-listed products that represent the global economy’s primary economic regions.

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Puerto Rico, Dominican Republic brace for tropical storm Dorian: CBS
UK prime minister wants to suspend Parliament ahead of Brexit: Bloomberg
Former NY Fed president suggests Fed consider politics in monetary policy: CNBC
Fed rejects idea of considering politics in policy decisions: WSJ
Bank lending in the eurozone accelerated in July: Reuters
Consumers remain confident on US economy in August: MW
US home price gains slow to a 7-year low in June: HousingWire
Mid-Atlantic region’s mfg activity picked up in Aug: Richmond Fed
S&P 500’s dividend yield above 30yr Treasury rate for 1st time in 10yrs: CNBC